Poverty

The Government of India wants to assist the very poorest people. Which policy would be most likely to achieve this?

Feb/March 2016

Average life expectancy for the poorest Americans is just as low as it is for the people of Sudan, a low-income African nation. People with low incomes are most likely to live longest in countries where the population is more educated. Economic growth can raise education levels and cut poverty. In 2017, the US President announced a reduction in the tax on firms’ profits. He said that this policy would boost employment.

Feb/March 2019

Which statement about poverty is accurate?

Feb/March 2021

What is the most probable reason for a rise in poverty in developing economies?

Feb/March 2024

Even in wealthy countries, some people still live in relative poverty. What is the most likely reason for this?

Feb/March 2025

Many economists think relative poverty will rise while absolute poverty will decline in both India and the United States of America. Poverty levels may be affected by factors such as education, the technology being used and the number of new businesses set up, including sole proprietorships.

May/June 2016

Which of the following statements about the poorest households in developing economies is least likely to be correct?

May/June 2017

Which characteristic would indicate that a country has substantial absolute poverty?

May/June 2018

More than two-thirds of the world’s poorest people are found in rural regions. Most of them depend on subsistence agriculture. What factors explain why poverty stays at a high level for families in subsistence farming?

May/June 2018

Which policy is most likely to cut relative poverty?

May/June 2019

UBI is a system in which the government gives every person a payment, no matter what their circumstances are. A scheme like this can support several groups, including the sick and the old. In 2016, the Indian government was considering UBI as a replacement for its current state benefits system. A politician in Costa Rica suggested a UBI of $337.5. Finland launched a two-year trial of a version of UBI in 2017. A guaranteed minimum income may help some poor people who currently receive no state benefits and may also cut inequality. In many countries, income and wealth inequality is rising. For example, in Russia 16% of the population live below the official poverty line and 10% of the population own 87% of the country’s wealth. State benefits are relatively low in Russia and the country has one income tax rate of 13%. One reason for the growing gap between rich and poor in Russia has been the impact on prices and profits caused by the privatisation of several state monopolies. Variations in annual average incomes (annual GDP per head) between countries can influence life expectancy, as shown in Table 1.1. In Finland, where average monthly income per head is $3500, the trial UBI is $600 per month. In a country with high prices, high taxes and periods of very cold weather, this does not meet everyone’s needs. In India, the average monthly income per head is almost the same as Finland’s UBI. A UBI could support unemployed people, including those who are only unemployed for a short time. Governments welcome lower unemployment. This is because output rises and governments can spend less on state benefits for the unemployed. They could then raise spending in other areas such as education and healthcare.

May/June 2019

In a high-income economy, the top 60% of the population experienced a rise in income. The income of everyone else remained unchanged. What happened to absolute and relative poverty?

May/June 2021

The top 60% of people in a high-income economy saw their income rise. The incomes of everyone else stayed unchanged. How were absolute poverty and relative poverty affected?

May/June 2021

The top 60% of people in a high-income economy experienced a rise in income. The income of everyone else stayed the same. What happened to absolute and relative poverty?

May/June 2021

In a recession, lots of people in a city lose their jobs and their incomes decrease. As a result, some are no longer able to pay the rent on their homes or purchase the food they require. What effect does the recession have on the city?

May/June 2023

The Peruvian government set a target of lowering the proportion of its population living in poverty. Which change would not show that the Peruvian government had made progress towards this target?

May/June 2023

Which factor is most likely to lead to a rise in relative poverty?

May/June 2023

Living standards, education included, have risen for most people in South Africa in recent years. Most households now have greater disposable income and the government collects more tax revenue. Even so, income inequality remains very large. In 2020, 36% of the population were living in poverty. Raising unemployment benefit payments could help to cut this poverty.

May/June 2023

Which option most accurately describes relative poverty?

May/June 2024

What is the most probable explanation for why a higher standard of education will reduce poverty?

May/June 2025

A government wants to narrow the difference between the incomes of the wealthy and the poor. What action should it take to achieve this objective?

Oct/Nov 2015

How are absolute poverty and relative poverty described?

Oct/Nov 2018

Malaysia’s Vision 2020 policy was introduced with the goal of turning Malaysia into a developed country by the year 2020. In addition, the National Privatisation Policy was also put into effect, under which a number of firms, including those in telecommunications, were transferred into private ownership. Poverty has dropped substantially since these policy measures were introduced.

Oct/Nov 2018

The table displays the percentage share of GDP owned by the richest 20% and the poorest 20% of people in each country. Which country showed the widest gap between income and poverty?

Oct/Nov 2019

The table indicates the percentage share of GDP owned by the richest 20% and the poorest 20% of the population in each country. Which country experienced the widest gap between income and poverty?

Oct/Nov 2019

The table gives the percentage of GDP owned by the richest 20% and the poorest 20% of the population in each country. Which country showed the largest gap between income and poverty?

Oct/Nov 2019

A country with low income suffers from extreme poverty in its rural regions. What is one possible cause of this?

Oct/Nov 2020

In countries where absolute poverty exists, low incomes can trigger a cycle that leaves incomes low. What stages make up this cycle?

Oct/Nov 2020

What is one specific cause of absolute poverty?

Oct/Nov 2021

Household poverty may be described in relative terms. What is a sign of relative poverty?

Oct/Nov 2021

What might help to reduce poverty?

Oct/Nov 2021

The Chinese government is worried about poverty levels and the requirement for additional resources in the country’s low-income areas. Consequently, it is raising spending in those areas while cutting it in high-income areas. Which economic concept is shown by this government policy?

Oct/Nov 2022

A decrease in the level of absolute poverty can be most effectively achieved by reducing

Oct/Nov 2022

Source material: Cambridge (UK) and Education Cambridge sits at number one among all UK cities for the proportion of workers holding a university qualification. It is also placed number two in the UK for the proportion of people aged 18-29. This reflects the very large student population in Cambridge universities. Even though the city’s population is relatively small, its share in the total size of the UK economy is substantial. A lot of firms in Cambridge are active in education, healthcare, research and development, and hi-tech manufacturing. Cambridge firms’ exports are strongly knowledge-intensive, so they are expensive and price-inelastic in demand. Rising incomes around the world have also pushed up demand for services such as education from Cambridge. An expansion in the education industry could help to cut poverty. A more educated labour force can earn higher wages and can also obtain more information about health. Table 1.1 gives the percentage of the population aged 25-64 with a university degree and the GDP per head in selected countries in 2019. Many residents of Cambridge strongly back globalisation and free trade between countries. A large number of firms in Cambridge rely on export earnings. Cambridge is an appealing place for expanding firms because many highly skilled and educated workers are available from across the world. It also has strong infrastructure, including access to ultra-fast broadband and transport links to other cities and international airports. However, firms may have to deal with high land and office costs. In 2019, Cambridge had the third highest house prices in the UK city ranking. Poor air quality may also put workers off moving to Cambridge.

Oct/Nov 2023

The number of people living in relative poverty in a country is falling. What is the most probable reason for this?

Oct/Nov 2024

Which factor is most likely to result in increased poverty within a country?

Oct/Nov 2025

In a number of high-income economies, rising income inequality has resulted in higher poverty levels. Which combination of policies would be intended to cut income inequality?

Oct/Nov 2025